8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED):

August 10, 2006

SUPREME INDUSTRIES, INC.

(Exact name of Registrant as specified in its charter)

Delaware	1-8183	75-1670945
(State of Incorporation)	(Commission File No.)	(IRS Employer Identification No.)

P.O. Box 237

2581 E. Kercher Road

Goshen, Indiana  46528

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: - (574) 642-3070

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.below):

o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Section 2 - - Financial Information

Item 2.02 Results of Operations and Financial Condition.

On August 10, 2006, Supreme Industries, Inc. (the “Company”) issued a press release (the “Press Release”) announcing its financial results for the second quarter and six-month period ended July 1, 2006.  A copy of the Press Release is being furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 2.02, and the foregoing description of the Press Release is qualified in its entirety by reference to Exhibit 99.1.

On August 10, 2006, the Company held a conference call to discuss its financial results for its second quarter and six-month period ended July 1, 2006.  A transcript of the conference call is being furnished as Exhibit 99.2  to this Current Report of Form 8-K.

Pursuant to General Instruction B.2 of Form 8-K, the information in this Form 8-K, including the exhibits hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, and is not incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

Section 9 - - Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits.

 (d) Exhibits

The following exhibits are furnished with this Form 8-K.

Exhibit No.	Description
99.1	Press Release of the Company dated August 10, 2006.
99.2	Transcript of conference call held by the Company on August 10, 2006.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

			SUPREME INDUSTRIES, INC.
Date:	August 15, 2006	BY: /s/ Jeffery D. Mowery
			Jeffery D. Mowery
			Vice President of Finance and Chief Financial Officer
			(Signing on behalf of the registrant and as Principal Financial Officer)

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Exhibit Index

Exhibit No.	Description
99.1	Press Release of the Company dated August 10, 2006.
99.2	Transcript of conference call held by the Company on August 10, 2006.

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EX-99.1

Exhibit 99.1

SUPREME INDUSTRIES, INC.

For Immediate Release

Contact:Robert W. Wilson

President

(574) 642-3070

Supreme Industries Reports Revenues and Earnings
for the Second-Quarter and First Six-Month Periods of 2006

GOSHEN, Ind., August 10, 2006 — Supreme Industries, Inc. — (AMEX:STS), a leading manufacturer of specialized transportation products, including truck bodies and shuttle buses, announced today its financial results for the 2006 second-quarter and six-month periods ended July 1, 2006.

The Company recorded net sales of $98.9 million for the second quarter of 2006, compared to $95.2 million for the same period last year, an increase of $3.7 million, or 3.8 percent. Net sales in the first six months declined $0.9 million, or 0.5 percent, to $184.6 million in the 2006 period from $185.5 in the 2005 period.  Increased net sales in the 2006 second quarter were primarily attributable to a 31 percent increase in net sales quarter over quarter in the Company’s StarTrans® Bus Division due to a new ordering cycle of various transit authorities.  In the six-month period, fleet sales decreased approximately 25 percent over the comparable 2005 period due to an industry-wide reduction in truck purchases by major fleet customers.  This decrease was partially offset by a 4 percent increase in the core dry freight product line and a 34 percent increase at StarTrans® from period to period.  Sales backlog was $81.1 million at July 1, 2006, compared to $72.6 million at June 25, 2005.

Net income for the second quarter was $1.6 million, or $0.12 per diluted share, in 2006 compared to $2.9 million, or $0.23 per diluted share, in 2005, and for the first six months was $2.9 million, or $0.23 per diluted share, for the 2006 period and $6.0 million, or $0.47 per diluted share, in the 2005 period.

Gross profit as a percentage of net sales declined in both the quarter and six-month periods, primarily as a result of product mix and higher raw material costs relating to significant cost increases in aluminum, steel and wood components. The bus division accounted for a greater percentage of our product sales than in 2005.  These products have higher material costs and as a result, the increased sales volume in this division contributed to the increase in raw material costs as a percentage of net sales and the decline in gross margin percentage.

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Selling, general and administrative expenses decreased as a percent of net sales from 7.7 percent in the 2005 second quarter to 7.4 percent in the 2006 second quarter, and increased from 7.4 percent in the first six months of 2005 to 7.7 percent in the same period of 2006. SG&A expenses increased in the 2006 first six-month period primarily due to a reduction in cooperative marketing credits received from chassis manufacturers versus the same period last year.

Interest expense increased from $568 thousand in the second quarter of 2005 to $835 thousand in the same period of 2006. For the first six months, interest expense increased from $1.1 million in 2005 to $1.5 million in 2006. The increase in interest expense for both periods is a result of increased debt incurred principally for increased working capital and higher interest rates in 2006 versus 2005.

Stockholders’ equity improved to $76.0 million, or $5.98 per share, as of July 1, 2006.  At the end of the quarter, working capital totaled $61.7 million compared to $55.3 million last year.  The Company continues to aggressively manage its working capital assets, and during the second quarter, inventories and accounts receivable decreased by $7.4 million and $2.7 million, respectively, as compared to the first quarter.

President Robert W. Wilson stated, “We are disappointed in the first six months earnings performance.  The period was negatively impacted by higher raw material costs, and we continue to be challenged with matching ongoing inflation in material costs with customer price quotes. We did, however, implement price increases ranging from 3 percent to 5 percent on a majority of our truck division products in late May.  The anticipated increased revenue associated with these price increases will be gradually and increasingly realized throughout the third quarter. This delayed effect is principally due to the industry practice of not applying price increases to existing orders and outstanding quotes, the aggregate of which in late May was substantial and thus has caused the delayed effect of realizing any material benefit from the price increases.  To better manage these industry practices, the Company intends, when and where market conditions permit, to implement price increases on a more anticipatory and timely basis to meet the unprecedented challenges of volatile commodity costs.”

“Among other efforts to improve margins, Silver Crown (recently formed to conduct the operations of our Pony Xpress acquisition) has enabled us to focus on the development of highly specialized higher margin vehicles for the homeland security and law enforcement markets,” Wilson continued.  “Also under the homeland security umbrella, Supreme is now only one of three direct suppliers of armored Suburbans approved by the U.S Government.

“Additionally, Supreme has been working closely with General Motors to develop a small service vehicle, anticipated to be in production in the near future, to replace GM’s discontinued Astro Van.  With customer input and interaction throughout the design process, this new vehicle will be sold to GM fleet customers nationwide.  Lastly, a new website is under development to provide more interactive information and services to our customers.”

Supreme Industries announced on August 8, 2006 a cash dividend on its outstanding Class A and Class B Common Stock.  Stockholders of record as of August 21, 2006, will receive $0.095 for each share owned on that date, payable on August 28, 2006. This cash dividend is the twelfth

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consecutive quarterly cash dividend since the Company commenced the payment of regular cash dividends in October of 2003.

Future cash dividend payments are necessarily subject to business conditions, the Company’s financial position, and requirements for working capital, property, plant, and equipment expenditures and other corporate purposes.

A live webcast of Supreme Industries’ earnings conference call can be heard today at 4:30 p.m. Eastern Time at www.supremeind.com.

Supreme Industries, Inc. is a nationwide manufacturer of specialized truck bodies that are produced to the specifications of its customers. Supreme also manufactures the StarTrans® line of special-purpose “shuttle-type” buses.  The Company’s transportation equipment products are used by a wide variety of industrial and commercial customers.

The Company’s significant accounting policies are discussed in Note 1 of the Notes to Consolidated Financial Statements included in the Annual Report on Form 10-K for the year ended December 31, 2005.  In Management’s opinion, the Company’s critical accounting policies include allowance for doubtful accounts, excess and obsolete inventories, inventory relief, accrued insurance and accrued warranty.

This report contains forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995), other than historical facts, which reflect the view of the Company’s management with respect to future events. When used in this report, words such as “believe,” “expect,” “anticipate,” “estimate,” “intend,” and similar expressions, as they relate to the Company or its plans or operations, identify forward-looking statements. Such forward-looking statements are based on assumptions made by and information currently available to the Company’s management. Although management believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations are reasonable, and it can give no assurance that such expectations will prove to have been correct. Important factors that could cause actual results to differ materially from such expectations include, without limitation, limitations on the availability of chassis on which the Company’s product is dependent, availability of raw materials, raw material cost increases, and severe interest rate increases. Furthermore, the Company can provide no assurance that such raw material cost increases can be passed on to its customers through implementation of price increases for the Company’s products. The forward-looking statements contained herein reflect the current views of the Company’s management with respect to future events and are subject to those factors and other risks, uncertainties and assumptions relating to the operations, results of operations, cash flows and financial position of the Company. The Company assumes no obligation to update the forward-looking statements or to update the reasons actual results could differ from those contemplated by such forward-looking statements.

Financial Tables Follow…

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Supreme Industries, Inc. and Subsidiaries
Consolidated Statements of Income (Unaudited)

	Three Months Ended				Six Months Ended
	July 1,		June 25,		July 1,		June 25,
	2006		2005		2006		2005
Revenue:
Net sales	$	98,863,512	$	95,216,407	$	184,610,650	$	185,538,711
Other income	96,851		138,914		204,091		300,218
	98,960,363		95,355,321		184,814,741		185,838,929
Costs and expenses:
Cost of sales	88,332,555		82,970,295		164,474,007		161,666,831
Selling, general and administrative	7,341,767		7,294,334		14,200,733		13,752,416
Interest	834,660		568,387		1,535,585		1,057,033
	96,508,982		90,833,016		180,210,325		176,476,280
Income before income taxes	2,451,381		4,522,305		4,604,416		9,362,649
Income taxes	886,000		1,622,000		1,666,000		3,368,000
Net income	$	1,565,381	$	2,900,305	$	2,938,416	$	5,994,649
Earnings per share:
Basic	$	.12	$	.23	$	.23	$	.49
Diluted	.12		.23		.23		.47
Shares used in the computation of earnings per share:
Basic	12,692,632		12,391,341		12,691,143		12,288,776
Diluted	12,892,625		12,708,871		12,913,984		12,651,893
Cash dividends per common share	$	.095	$	.035	$	.19	$	.07

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Supreme Industries, Inc. and Subsidiaries
Consolidated Balance Sheets

	July 1,		December 31,
	2006		2005
	(Unaudited)
Assets
Current assets	$	88,683,985	$	88,609,777
Property, plant and equipment, net	47,484,994		47,457,713
Goodwill and intangible assets, net	1,426,833		735,014
Other assets	938,017		549,350
Total assets	$	138,533,829	$	137,351,854
Liabilities
Current liabilities	$	26,973,247	$	27,819,756
Long-term debt	32,470,366		31,378,367
Deferred income taxes	3,136,475		2,988,275
Total liabilities	62,580,088		62,186,398
Total stockholders’ equity	75,953,741		75,165,456
Total liabilities and stockholders’ equity	$	138,533,829	$	137,351,854

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EX-99.2

Exhibit 99.2

Bob Wilson

Good afternoon everyone.  Thank you for joining us for today’s conference call to discuss Supreme’s second quarter and first half of 2006 financial results.  The press release was issued this morning.  If you have not received a copy, please call Supreme’s offices at 574.642.3070 and one will be faxed to you.  Joining me today are Supreme’s Vice President, Christy Miller, manufacturing; Barry Lown, sales and marketing and Jeff Mowery, CFO.  I will provide a financial overview and additional details on the quarter.  After that, the team will be available to answer any questions that you may have.  Before we begin, I must remind you that during our conversation today you may hear some forward-looking statements.  Although we believe that the expectations reflected in the forward-looking statements are reasonable and that those statements are based on reasonable assumptions, we cannot guarantee that we will meet any expectations that might arise from these forward-looking statements and their underlying assumptions.  Some of the important factors that could cause Supreme’s results to differ materially from such expectations include:  limitations on the availability of chassis for its products, the availability of raw material, severe interest rate increases and other factors that are detailed in our SEC filings.

In the second quarter of 2006, Supreme recorded net sales of $98.9 million, compared to $95.2 million for the same period last year, an increase of $3.7 million, or 3.8 percent. Net sales in the first six months declined $0.9 million, or 0.5 percent, to $184.6 million in the 2006 period from $185.5 in the 2005 period.  Increased revenues in the 2006 second quarter are primarily attributable to a 31 percent increase in revenue, quarter-over-quarter, in the Company’s StarTrans Bus Division.  In the six-month period, fleet sales decreased approximately 25 percent over the comparable 2005 period due to a industry wide reduction in truck purchases by major fleet customers.  This decrease was partially offset by a 4 percent increase in the core dry freight product line and a 34 percent increase at Startrans from period to period.

Gross profit as a percentage of net sales declined in both the quarter and six-month periods, primarily as a result of product mix and higher raw material costs, as the Company experienced significant upward cost pressure on aluminum, steel and wood components.

To combat the previously mentioned upward cost pressures on materials, we implemented price increases ranging from 3 percent to 5 percent on a majority of our truck division products in late May.  The anticipated increased revenue associated with these price increases will be gradually and increasingly realized throughout the third quarter. This delayed effect is principally due to the industry practice of not applying price increases to existing orders and outstanding quotes, the aggregate of which in late May was substantial and thus has caused the delayed effect of realizing any material benefit from the price increases.  To better manage these industry practices, the Company intends, when and where market conditions permit, to implement price increases on a more anticipatory and timely basis to meet the unprecedented challenges of volatile commodity costs.

Selling, general and administrative expenses decreased as a percent of net sales from 7.7 percent in the 2005 second quarter to 7.4 percent in the 2006 second quarter, and increased from 7.4 percent in the first six months of 2005 to 7.7 percent in the same period of 2006. SG&A expenses increased in the 2006 first six-month period primarily due to a reduction in cooperative marketing credits received from chassis manufacturers versus the same period last year.  As a reminder, these credits are determined solely by programs established by the chassis manufacturers, which have historically been used to offset marketing and promotional expenses.

Interest expense increased from $568 thousand in the second quarter of 2005 to $835 thousand in the same period of 2006. For the first six months, interest expense increased from $1.1 million in 2005 to $1.5 million in 2006. The increase in interest expense for both periods is a result of increased debt incurred principally for increased working capital and higher interest rates in 2006 versus 2005.

Supreme’s effective tax rate for the current quarter was 36.1 percent versus 35.9 percent in the prior-year period, while the tax rate for the current six month period was 36.2 percent versus 36.0 percent last year.

Net income in the quarter was $1.6 million, or $0.12 cents per diluted share, compared to $2.9 million, or $0.23 cents per diluted share, in the second quarter of 2005.  For the 2006 six-month period net income totaled $2.9 million versus $6.0 million in the 2005 first six-month period.

During the second quarter of 2006, the Company received $1.9 million in proceeds related to the sale of a portion of its Pennsylvania manufacturing facility as a result of moving to a larger and more efficient facility in 2005.  A small gain on the sale of the facility was recorded.  To further support our growth, capital expenditures totaled $2.2 million in the first six-month period of 2006 as compared to $2.9 million for the same period of 2005.  As we announced last quarter, major capital expenditures in the first half related to the purchase of a manufacturing facility located in White Pigeon, Michigan, for the expansion of the recently acquired Pony Express operations.  The Company intends to spend less on property, plant and equipment in 2006, as compared with 2005 expenditures.  However, we will consider strategic opportunities for growth and expansion should they present themselves.

Turning to the balance sheet, Stockholders’ equity improved to $76.0 million, or $5.98 per share, as of July 1, 2006.  At the end of the quarter, working capital totaled $61.7 million compared to $55.3 million at the end of last year’s second quarter.  The Company continues to aggressively manage its working capital

assets, and during the second quarter, inventories and accounts receivable decreased by $7.4 million and $2.7 million, respectively, as compared to the first quarter.  Additionally, I would like to point out that debt was significantly reduced in the second quarter as long-term debt totaled $32.5 million as of July 1, 2006, as compared to $39.9 million as of April 1, 2006.

The Company’s 12th consecutive quarterly cash dividend was declared on August 8, 2006.  The $0.095 cash dividend will be payable on August 28, 2006, and the record date is August 21, 2006.

Sales backlog was $81.1 million at July 1, 2006, compared to $72.6 million at June 25, 2005.

While the competitive landscape remains challenging, we have optimism that we can improve financial results going forward.  As mentioned previously, we have instituted a price increase on a majority of our truck products in late May, and we should increasingly realize the effect of the increases as the third quarter progresses.  We are evaluating the need for further selective price increases with intent of implementing them on a timely basis.  Among other efforts to improve margins, the Company has focused on new product development for highly specialized vehicles for the homeland security market. Under this homeland security umbrella, Supreme is now only one of three direct suppliers of armored suburbans approved by the U.S. government. As discussed in our press release,

we are developing the capabilities to market and produce highly specialized vehicles with an emphasis on homeland response and law enforcement.  It will also integrate tactical armored products built at our Texas facility.

Supreme and GM have cooperated in the development of a fiberglass body to replace GM’s discontinued Astro Van.  The prototype, designed with customer input and interaction, was well received at the GM Fleet Preview.  After product validation, the “Astro Body” will be marketed to GM fleet customers.  StarTrans Bus Division is developing a new high end shuttle bus to debut at Bus Con in October.  The product was developed through a product planning process involving key customers, who have placed initial orders.  The new product will be sold at higher margins than our current offerings.  Also, while there are other initiatives on the new product development front, we must refrain from mentioning them for competitive purposes.  Finally, a new website is under development to provide more interactive information and services to our customers.

In closing, I want to emphasize that myself and Supreme’s management team are extremely disappointed in our earnings performance in the second quarter and first six months of 2006.  We are committed to improving our financial results and reducing the impact of increased material costs on a more timely basis.  As employees and substantial shareholders, our focus is to improve long term shareholder value.

With that being the conclusion of our formal remarks, we would now like to open the call for any questions you may have.  Operator….